Vancouver clothing designer and manufacturer Alan Yiu has found a market selling his Canadian-made down jackets to consumers in tropical Asian countries. Go figure.

Vancouver clothing designer and manufacturer Alan Yiu has found a market selling his Canadian-made down jackets to consumers in tropical Asian countries. Go figure.

"When we opened up Hong Kong this year, their (single) order was larger than most of our American (ones)," Yiu said of his Westcomb Outerwear products.

"They purchased a lot of down. When I was there at the end of February, it was 15 degrees. I was wearing a T-shirt and shorts, and I was sweating walking from the hotel to the ferry, but everyone else was wearing down."

Locals used to blazing tropical heat were chilled, Yiu explained.

Asian markets love products that are made in Canada, and customers are more than willing to pay a premium for them, said Vancouver-raised Yiu, who studied fashion merchandising at Los Angeles' Fashion Institute before starting Westcomb Outerwear in 2005.

"The buyers are saying this is an angle that's gaining momentum."

There is cachet in wearing technical outerwear from a cold country, and a healthy Asian travel market doesn't hurt - a Singapore buyer told Yiu 70 per cent of the population travels, and many shop before leaving home.

While Westcomb is a small company with revenues of around $3 million, its Asian sales have taken off, strongly surpassing its established North American market. The firm designs and manufactures all of its down, softshell and hardshell clothing in Vancouver.

"It's been a breakthrough season for us in Asia," Westcomb COO John Evans said. Korean sales doubled between the fall of 2013 and fall 2014. Overall, 2013 sales were up 40 per cent over 2012. First-quarter 2014 sales were up 35 per cent.

But how does Westcomb hope to make a dent against heavyweights such as Arc'teryx, Mammut, Mountain Hardware and North Face, whose products are generally made in Asia?

On the expense side, Yiu keeps it lean with just six front-office staff, and he is the sole designer. He employs 30 production staff in his 11,000-square-foot factory in East Vancouver.

While Bangladesh factory workers earn about $50 a month and Chinese workers can earn $400 a month, Yiu pays a minimum of $12 an hour, so if buyers are expecting their Canadian-made products to be just 30 per cent more expensive than Asian-made, they are "way off."

Yiu is accepting lower margins as he establishes his market. "We work on a five-to eight-point differential on gross margin because our direct labour and direct materials are significantly higher than our competitors," Evans said. "We have to be able to survive on lower indirect costs."

The gross margin for Canada's clothing manufacturing subsector was 39.2 per cent in 2011, according to Industry Canada, but Yiu said the benchmark for firms that contract out to Asia is closer to 60 per cent.

On the income side, Westcomb product is unabashedly premium priced. Think $280 to $600 for a down jacket. Products retail in Asia for about 30 per cent more than in North America. "I saw one of our hardshells, top of the line, which retails just under $500 in Canada, in Japan for $800 (Cdn)," Yiu said.

Yiu has the strong advantage of being able to schedule Westcomb production around contract work at his own factory. He was also born into the business and credits his family relationships for a hefty leg up. His mother works with him, and his father owns Winter Sportswear, a 35-year-old Vancouver contract factory that sews for Canada Goose and has worked with both R.E.I. and Mountain Equipment Co-op. Yiu's own factory produces a shifting combination of about half Westcomb and half contract work.

He is particular about quality, insisting on such details as 18 to 20 stitches per inch, versus the more common eight to 10. "The most important thing is to preserve the skill sets (at the factory)," said Yiu. "Today, we got a call from a U.K. brand that wants to do down jackets here. I supply the military in Singapore with our jackets."

For innovation, the small firm relies on its position as a "launch partner" with brand-name textile companies such as Polartec and PrimaLoft.

The Asian outdoor lifestyle market is much larger than the actual mountaineering and camping markets, Yiu said. Colour is a huge deciding factor for consumers, and pricing less so, he said.

"(Asian) taste is quite different. Simply put, I'd say 'loud.' If they are wearing a jacket they spent good money on, they want to be seen."

The challenge in meeting that Asian demand is whether neon orange, for example, will sell in enough volume to warrant a production run, and whether the risky colour will also be relevant to North American buyers.

Colour is tricky at the best of times. "When I first started, I had the same four colours for the first four years because I couldn't get past the minimums," Yiu said. "There was an awful orange, old green, typical blue and black."

In North America, Westcomb product is sold through R.E.I. stores, online merchants and small independent retailers such as North Shore Ski and Board in North Vancouver.

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